Ministers were today set to unveil a £40m package to kick-start the region's tourism industry following the double blow of September 11 and foot-and-mouth disease.

Culture Secretary Tessa Jowell was expected to announce the cash in a bid to tempt visitors back to UK's most popular destinations such as the Lake District.

The British Tourist Authority will be given the money after Chancellor Gordon Brown gave the go-ahead for an extra £20 million, according to reports.

Tourists deserted the countryside after footpaths and vast sections of the North-East countryside were closed during the foot-and-mouth epidemic.

The September 11 attacks hit the airline industry hard. Newcastle-based Gill Airways ceased trading and laid off 240 staff and British Airways announced plans to cut flights by ten per cent and ground 20 aircraft with a possible knock-on effect to its 1,000 call centre staff in Newcastle.

A spokesman for the Department of Culture, Media and Sport confirmed an announcement was being made today but would not give further details.

The first official attraction visitor figures for last year showed the full extent of the tourist downturn-with London the worst hit.

Leading attractions such as Blackpool Pleasure Beach, Tower of London and The British Museum were all down on last year's visitor numbers.

Tyne and Wear Museums, which owns the Laing Art Gallery and the Discovery museum in Newcastle, was one of the few attractions that enjoyed a rise in numbers.

It had almost 1.5million visitors last year, an increase of 15 per cent.

A spokeswoman for Beamish Open Air Museum in Chester-le-Street said that its visitor numbers would be slightly down for last year.

She said: "Visitor numbers will be slightly down. We have had a great number of visitors who live in the region coming here but the number of tourists visiting the area from outside are very definitely down."

A new survey by the British Hospitality Association has shown the that tourism industry is on the mend.

In October-December 2001 period, 47 per cent of hotels outside London reported better occupancy figures than in the same period in 2000.

Almost half of provincial hotel owners believed that trading will be better or much better in the first three months of this year compared to January-March 2001.